A pending court case may affect the legality of all agricultural check-off programs.

Two dairy farmers have brought suit to end forced payment of check-off fees. They say they don’t benefit by the federal Dairy Promotion Program. In fact they spend a lot of money to tout the differences between their milk and “common” milk.

These farmers give their 150 cows more room, and use traditional, extensive grazing methods rather than modern chemically supplemented, indoor-raised herds. They don’t administer BGH (milk-enhancing hormones) to their cattle, either.

But the Dairy Act forces them to pay for promoting dairy products they don’t believe in, and which are competing against their traditionally-produced milk.

Traditional dairy farmers Joseph and Brenda Cochran of Westfield, PA filed Cochran v. Veneman in April, 2002. They lost their original case because (as the court ruled) the dairy industry is already heavily regulated, and therefore, as regards their dairy business, the Cochrans do not have a right to free speech.

Conflicting Rulings

The court cited a 1997 U.S. Supreme Court ruling that compelled California peach and nectarine growers to subsidize a collective advertising program-because they operate in a heavily regulated industry.

But in 2001, the High Court struck down a program that required mushroom growers to do the same, because they are not as regulated.

Steve Simpson, senior attorney with the Washington, D.C.-based Institute for Justice, says “The U.S. Supreme Court long ago held that the 1st Amendment does not allow government to compel individuals to speak, just as it does not allow government to prevent them from speaking.”

Mr. Simpson argues that “Courts are telling agricultural producers that as long as the government controls their prices, production, terms of sale, and so on, it may as well control their free speech, too. But two wrongs don’t make a right; restricting one kind of freedom-economic liberty-isn’t license to destroy another-free speech.”

Where It’s Headed

The case is now at the 3rd Circuit of the U.S. Court of Appeals, in Philadelphia, PA, and was heard on January 12, 2004.

The Dairy Program’s defenders claim that it will increase demand for dairy farm products. They say this is needful to cut federal spending on the dairy price support program. Begun in 1949, that plan requires the feds to buy up dairy products whenever milk prices fall too low. The idea was to prop up milk prices, with the government as the “buyer of last resort.”

Alas, the dairymen had little incentive to cut production when prices fell. So the government was forced to buy dairy products it couldn’t use, and before long it had a lot it couldn’t use, plus a very large bill.

Thus, backers of the famous “Got Milk?” ads (many of those backers are government officials) say the program is needed in order to make folks buy up all that excess milk, so the feds won’t have to. You can bet they’ll fight any adverse ruling on it all the way to the Supreme Court.

So will the plaintiffs, and they’re not the only ones. A whole slew of similar litigants are waiting to hear the outcome of this case.

They’re demanding “free speech,” and right now it looks as if they have a pretty good shot at getting it.

How It Affects Flockmasters

According to 2001 USDA data (NAHMS), about 2% of sheep operations grow a little over half of all U.S. sheep. These 1,306 outfits own 55% of the nation’s sheep, with an average flock size of a little more than 3,300 sheep. Bands of sheep this big are mostly going into the “mainstream” lamb and wool marketing pipelines.

The remaining 98% of sheep growers (over 64,000 strong) have an average flock size of 54 head. Of this group of flocks, over 35,500 (54% of all U.S. sheep operations) average less than 10 head per flock. Certainly a very large number of this group doesn’t market any lamb or wool products through “mainstream” marketing channels, preferring instead to sell to niche and local markets. In order to be successful at this, these growers must tout the differences between their flock’s meat and/or wool and the meat and/or wool of the “mainstream.” These people, like it or not, are required by law to pay check-off fees that will be used to fund the advertising for their competitors in the larger lamb industry.

Certainly the percentage of non-mainstream sheep grower/sellers is much greater than the percentage of non-mainstream dairy, beef, pork or chicken producers.

If Cochran v. Veneman alters the Dairy Promotion Program, you can bet it won’t be long before at least some sheep people-the most ruggedly independent of all livestock growers-try to throw off the yoke of the lamb check-off too.

They may even get help from public interest law firms such as the Institute for Justice.

The sheep industry as a whole is small, and would have a hard time fending off such lawsuits, especially at such a low point in our history.

Sheep prices are good right now. It’s a good time to begin to prepare alternative marketing plans for your flock products, regardless of how you feel about communal ad campaigns, so that if there’s trouble, you have something to fall back on.

Also, in case you would like to monitor the Institute for Justice, their website is: www.ij.org